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March 28th Market Wrap-Up

The indexes could be much more clearly analyzed based upon candlestick signals on individual days. The major indexes have been moving sideways over the past few trading days, just above and below the T line. This would make it hard to analyze whether the markets were ready to sell off or continue in an upward trend but for the fact that the transportation index continues to trade in a strong upward trend. Logic should indicate that there is not any consensus selling ready to occur in the overall market if one of the indexes is still revealing strong bullish sentiment. Knowing that the overall market is not ready to sell off allows candlestick signals and patterns to perform with much greater profitability.

The frypan bottom pattern is still working effectively in numerous stock positions i.e. PZZA, BIG. Other patterns, such as the J-hook pattern is showing good profitability. ANF is demonstrating a strong J-hook pattern after confirming an inverted hammer signal. This adds great credibility to the new uptrend based upon the relevancy of an inverted hammer followed by bullish confirmation. The probabilities of an uptrend from those conditions are extremely high, 95% or greater. Because human nature works the same way time after time, the candlestick investor has the benefit of being able to analyze what is about to happen based upon the confirmation of a reversal signal or a pattern breakout because of centuries of observation and implementation of candlestick signals. No matter what trading program an investor may be utilizing, overlaying candlestick analysis on to the chart dramatically improves the analytical analysis of prospective trades.




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Good Investing,

The Candlestick Forum Team

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